Subsection (a) of
section 25B of the Internal Revenue Code of 1986 is amended by inserting
aggregate qualified HSA contributions and after so much
of the.

(b)

Qualified HSA
contributions

Subsection (d) of section 25B of such Code is
amended by redesignating paragraph (2) as paragraph (3) and by inserting after
paragraph (1) the following new paragraph:

(2)

Qualified HSA
contributions

The term
qualified HSA contribution means, with respect to any taxable
year, any contribution to a health savings account (as defined in section
223(d)(1)) if—

(A)

such contribution is
allowable as a deduction to the taxpayer under section 223(a) for such taxable
year, or

(B)

such contribution is made
by an employer of the taxpayer at the election of the taxpayer under a
cafeteria plan (as defined in section 125(d)) and is not includible in the
gross income of the taxpayer by reason of section
125.

.

(c)

Reporting of HSA
elective contributions

Paragraph (12) of section 6051(a) of such
Code is amended to read as follows:

(12)

the total amount contributed to health
savings accounts (as defined in section 223(d)) of the employee or the
employee’s spouse and the portion of such total amount contributed at the
election of the employee under any cafeteria plan (as defined in section
125(d)),

.

(d)

Conforming
amendments

Section 25B(d)(3)
of such Code, as redesignated by subsection (b), is amended—

(1)

by striking the first
sentence of subparagraph (A) and inserting the following: The aggregate
qualified retirement savings contributions determined under paragraph (1) and
qualified HSA contributions determined under paragraph (2) shall be reduced
(but not below zero) by the aggregate distributions received by the individual
during the testing period from any entity of a type to which contributions
under paragraph (1) or paragraph (2) (as the case may be) may be made.,
and

(2)

by inserting
223(f)(1) or (3), after section 72(p), in
subparagraph (C)(i).

(e)

Effective
date

The amendments made by this section shall apply to taxable
years beginning after December 31, 2012.

3.

Special rule for certain
medical expenses incurred before establishment of account

(a)

In
general

Paragraph (2) of
section 223(d) of the Internal Revenue Code of 1986 is amended by adding at the
end the following new subparagraph:

(D)

Treatment of certain
medical expenses incurred before establishment of account

If a health savings account is established
during the 60-day period beginning on the date that coverage of the account
beneficiary under a high deductible health plan begins, then, solely for
purposes of determining whether an amount paid is used for a qualified medical
expense, such account shall be treated as having been established on the date
that such coverage
begins.

.

(b)

Effective
date

The amendment made by this section shall apply with respect
to coverage beginning after the date of the enactment of this Act.

4.

Allow both spouses to
make catch-up contributions to the same health savings account

(a)

In
general

Paragraph (5) of
section 223(b) of the Internal Revenue Code of 1986 is amended to read as
follows:

(5)

Special rule for
married individuals with family coverage

(A)

In
general

In the case of individuals who are married to each other,
if both spouses are eligible individuals and either spouse has family coverage
under a high deductible health plan as of the first day of any month—

(i)

the limitation under
paragraph (1) shall be applied by not taking into account any other high
deductible health plan coverage of either spouse (and if such spouses both have
family coverage under separate high deductible health plans, only one such
coverage shall be taken into account),

(ii)

such limitation (after
application of clause (i)) shall be reduced by the aggregate amount paid to
Archer MSAs of such spouses for the taxable year, and

(iii)

such limitation (after
application of clauses (i) and (ii)) shall be divided equally between such
spouses unless they agree on a different division.

(B)

Treatment of additional
contribution amounts

If both spouses referred to in subparagraph
(A) have attained age 55 before the close of the taxable year, the limitation
referred to in subparagraph (A)(iii) which is subject to division between the
spouses shall include the additional contribution amounts determined under
paragraph (3) for both spouses. In any other case, any additional contribution
amount determined under paragraph (3) shall not be taken into account under
subparagraph (A)(iii) and shall not be subject to division between the
spouses.

.

(b)

Effective
date

The amendment made by this section shall apply to taxable
years beginning after December 31, 2012.

5.

Individuals eligible for
veterans benefits for a service-connected disability

(a)

In
general

Paragraph (1) of
section 223(c) of the Internal Revenue Code of 1986 is amended by adding at the
end the following new subparagraph:

(C)

Special rule for
individuals eligible for certain veterans benefits

An individual
shall not fail to be treated as an eligible individual for any period merely
because the individual receives hospital care or medical services under any law
administered by the Secretary of Veterans Affairs for a service-connected
disability (within the meaning of section 101(16) of title 38, United States
Code).

.

(b)

Effective
date

The amendment made by this section shall apply to months
beginning after December 31, 2012.

6.

Distributions by certain
early retirees for health coverage treated as qualified medical
expense

(a)

In
general

Subparagraph (C) of
section 223(d)(2) of the Internal Revenue Code of 1986 is amended by striking
or at the end of clause (iii), by striking the period at the end
of clause (iv) and inserting , or, and by adding at the end the
following new clause:

(v)

in the case of an account beneficiary who
has attained age 55 but not the age specified in section 1811 of the Social
Security Act, any group health plan (as defined in section 5000(b)(1)) in which
such account beneficiary is enrolled by reason of being a former employee or a
surviving spouse of a former
employee.

.

(b)

Effective
date

The amendments made by this section shall apply to amounts
paid for coverage for periods after December 31, 2012.

June 5, 2012

Reported with an amendment, committed to the Committee of
the Whole House on the State of the Union, and ordered to be
printed